TMI Blog2018 (5) TMI 1004X X X X Extracts X X X X X X X X Extracts X X X X ..... e of the assessee must be the official salary income, professional income of ₹ 24 lakhs per annum and relevant bank interest. Since assessee has disclosed the income based on bank deposits, which is not consistent with the source of income disclosed or found after search, we direct the AO to assess the income of the assessee only to the extent of above sources of income and wherever additional incomes based on the deposits are disclosed by the assessee should be eliminated as per the findings of CIT(A). Therefore, we are in agreement with the findings of the ld. CIT(A). The grounds raised by the assessee are partly allowed in all the three years under consideration. - ITA No. 692, 693 And 694/Hyd/2016 - - - Dated:- 11-5-2018 - SMT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Act ) was conducted at the residential premises of the assessee on 03/08/2011. Subsequent to the search, a notice u/s 153A of the Act was issued on 01/03/2012 for AYs 2006-07 to 2011-12. In response to the above notice, the assessee filed the return of income on 09/10/2012, admitting an income of ₹ 18,30,120/-. Notices u/s 143(2) and 142(1) of the Act along with the questionnaire were issued to the assessee. In response to the notices, the AR of the assessee filed the information as called for. The AO completed the assessment determining the assessed income at ₹ 45,54,070/- by making the additions towards i) unexplained cash credit of ₹ 3,23,949/- and ii) unaccounted cash salary of ₹ 24,00,000/-, which is the subj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... declaration, referring to the reply of the assessee to question no.14, given under Section 132(4) of the IT Act on 03.08.2011. In response, the assessee submitted a letter dated Nil. In this connection, it is pertinent to refer to the relevant portion of the reply of the assessee, particularly, in the context of the cash portion of salaries which is reproduced hereunder:- At the time of preparation of the return of income, the bank accounts, the deposits made and the deposits matured were all analysed. It was found that some of the deposits got matured and were re-deposited. When the redeposited amounts were withdrawn, fresh deposits made during the financial years 2005- 06 to 2011-12 aggregated only to ₹ 95,61,835. Therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee. It is therefore a reliable basis for computing assessable income for the relevant period. It is seen that the additional income offered by the assessee does not bear correspondence with this factual position. The additional income offered for the AYs 2008-09 to 2012-13 is ₹ 2.40 lakhs, ₹ 2.75 lakhs, ₹ 15.25 lakhs, ₹ 47.75 lakhs and ₹ 2,15,150/- respectively. During the hearing when questioned about this aspect, Ld. AR admitted this position, however, contended that the additional income offered was on the basis of accretion to fixed deposits in the bank accounts. This position is clearly unacceptable. Income has to be recognised as it accrues, arises or is received. Application of this income into assets ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rds. This disclosure was made mainly due to deposits in bank, which was detected by the department. She has filed two affidavits before the officers explaining the facts, as per which, she has disclosed this additional salary in cash under distress and later she found that some of the bank deposits, which have matured were deposited. Such deposits were properly reconciled and accordingly disclosed the additional deposits made in the bank. Ld. AR submitted that assessee has clearly brought on record the additional deposits made in bank and it is not proper to add ₹ 2 lakhs per month till the end of the year in which search took place. He further submitted that ld. CIT(A) was wrong in confirming the additions made by the AO. With regard ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t assessee was in receipt of ₹ 2 lakhs of professional income in cash. However, it was not deposited regularly in AY 2009-10 and 2010-11. Therefore, the income of the assessee must be the official salary income, professional income of ₹ 24 lakhs per annum and relevant bank interest. Since assessee has disclosed the income based on bank deposits, which is not consistent with the source of income disclosed or found after search, we direct the AO to assess the income of the assessee only to the extent of above sources of income and wherever additional incomes based on the deposits are disclosed by the assessee should be eliminated as per the findings of ld. CIT(A). Therefore, we are in agreement with the findings of the ld. CIT(A). ..... X X X X Extracts X X X X X X X X Extracts X X X X
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